This blog post will be the 6th and final post for this series on Challenging the Force-Placed Insurance (FPI) Business Model.
This memo serves to update Miniter’s position regarding our COVID-19 insurance tracking based on new guidance available from the April 27, 2020 OCC update, the Federal Reserve Q&A published May 6, 2020, and the May 7, 2019 FDIC Q&A (updated).
The history of Force-Placed Insurance would not be complete without including the force-placed flood insurance turmoil that occurred after the 2012 passage of the Biggert-Waters Act.
In part 3, we discussed how money center banks created a force-placed insurance fee income source using captive insurance companies owned by the lenders. In this segment, we will discuss how regulators and class-action attorneys put force-placed insurance back on course.
To understand why the words “force-placed insurance” appear in the Dodd-Frank Law 331 times, we have to look back on how the money-center banks got involved in the force-placed insurance premium money train.